3

What is the relationship between businesses and their environment?

Businesses and the environment affect each other in a 'sub-system - upper system relationship'.

What are the basic functions listed under the internal environment of a business?

Supply function, Production function, Marketing function, Financing function, Management function.

What three functions together constitute the material flow?

Supply Function, Production Function, Marketing Function.

What is the difference between material flow and cash flow?

Material flow is the original flow and is sequential; cash flow is the derived flow and is not mandatory.

What are the stages required for information flow?

Information collection, Information processing, Evaluation, Decision making, Implementation of decisions, Control.

What are traditional production factors?

Labor, Capital, Natural resources.

What are contemporary production factors?

Entrepreneurship, Know-how.

How is total cost calculated in terms of production factors?

Total Costs = Fixed Costs + Variable Costs.

What types of labor are considered in business economics?

Physical Labor, Intellectual Labor, Managerial Labor, Entrepreneurship.

How does information flow optimize material flow and cash flow?

Information gathering, analysis, and decision making aid in optimizing both material flow and cash flow.